§ 547 p.m.
§ Order of the Day for the Second Reading read.
§ LORD HENDERSON
My Lords, I beg to move the Second Reading of this short Bill, the purpose of which is to increase by £20,000,000 the sums available to meet the cost of the temporary housing programme. At present the amount which the 1216 Minister of Works may spend for this purpose is limited to a total of £200,000,000. Originally, the Housing (Temporary Accommodation) Act of 1944 authorized a maximum of £150,000,000, but this was later raised to £200,000,000 by Section 5 of the Building Materials and Housing Act, 1945. The latest and, it is expected, the final estimate, is £217,000,000, but it has been thought advisable to make an additional allowance of £3,000,000 to cover contingencies. Approval is sought, therefore, for a total of £220,000,000.
Before I go on to deal with the reasons for these successive increases, your Lordships will, I think, be interested in a few facts about the temporary housing scheme itself. The total number of temporary houses being provided is 156,667, of which 124,511 have been allocated to England and Wales and the balance of 32,156 to Scotland. Of the temporary houses 54,500 are of the aluminium type which are manufactured and erected through the agency of the Ministry of Supply. The other 102,117 are made up of seven principal types for which the Ministry of Works are responsible. The programme is now within sight of completion and it will not be extended. The number of houses outstanding on October 31 was only 24,184, and 17,496 of these are aluminium houses, the programme of which is due for completion next May. On the other types, work should finish by the end of this year in England and Wales, but in Scotland there are likely to be a few houses remaining for completion next summer.
That is a brief history of the programme. I come now to the principal factors which have given rise to the increase in its cost, which has risen by about £39,000,000 from the comparable estimate in the White Paper of October, 1945. There are four main causes of this increase, and I will deal with each in turn. The first factor is the substantial increase in wage rates and in the price of materials. This has added to the cost of site preparation work and of house erection. Similarly, there have been increases in the costs of fixtures and fitments. The second factor is the additional costs of distribution and transport. The original intention was to complete the temporary housing programme, except for the aluminium 1217 house, by the end of 1946. It was, however, not found possible for local authorities to acquire sites and complete road development work in time to enable this to be done. Most of the sites which were readily available were required for permanent housing and additional sites were not easy to obtain, especially in the built-up industrial areas to which most of the temporary houses had been allocated.
After sites had been acquired there were difficulties such as shortages of material and of labour to be overcome; and last winter while; local housing authorities were undertaking concurrently site development for both permanent and temporary houses, work was practically suspended for two or three months over a large part of the country owing to the severe weather. Local authorities played their part magnificently but it was inevitable that the organization set up for the storage and distribution of the houses had to be kept in being for at least a year longer than was expected. The number of centres had also to be increased during 1946 owing to unbalanced production of house components and of fixtures and fittings. Factories were changing over from war-time to peace-time production, labour was being re-deployed, and there were recurring shortages of material resulting in an accumulation of unbalanced stocks which had to be stored. It became necessary to take over a large number of airfields for this purpose, and this proved to be expensive, as many were far removed from railway and main roads and the costs of loading and handling were further increased by the distances between individual buildings. Moreover, labour had to be brought to these centres at additional expense and there was unavoidably a considerable amount of double handling and inter-depot movement. It is for these reasons that the cost of distribution and of transport has proved to have been under-estimated.
The third increase is in the costs of site erection. The unbalanced production during 1946 of fixtures and fittings often held up the completion of houses. This, combined with delay from occasional labour difficulties and severe winters, inevitably led to extra expense on the sites. The outcome is that the basic price of the principal types of prefabricated temporary houses has increased from about £1,043 to £1,180, the costs ranging from £1,079 to £1,243. To this has to be added 1218 capital expenditure incurred on the production of steel fitments and an overall contingency provision to cover ex: ra expenses that have been incurred by site erection contractors ow: mg to delays in the delivery of fitments and other causes beyond their control.
Finally, the fourth main factor in the increase is the rise in the cost of the aluminium temporary house, from the tentative figure of £1,365 to its present one of £1,610. This house is wholly factory built and it was always known that it would be more expensive than the other types of temporary house. The decision to proceed with this house was taken in 1945 when, with the war continuing, it became evident that factory capacity, steel and labour could not be released for the production of the steel temporary house for at least a year, whereas the production of the aluminium house could start much sooner. Moreover, its inclusion in the programme was considered to be justified on broad national grounds, in that assistance would be given during the period of transition from war to pea: e to the greatly expanded light metals industry and in easing the employment of ex-aircraft workers. The great merit of the aluminium house is that it is wholly prefabricated and can be erected in a few hours with very little building labour. Including it in the programme has meant that, in spite of all the shortages and difficulties which have hindered progress, it has been possible to build two houses per year per man employed in the building industry. This is about double the rate at which it has been reckoned that permanent houses were built before the war, and it has meant that a substantial number of houses has been built which would not otherwise have been provided.
In the debates on this Bill in another place, a number of requests were made for further particulars of the cost of the various types of temporary house and for detailed explanation of toe reasons for the increases. My right honourable friend the Minister of Works has promised that before the end of the year a statement will be published, possibly in the form of a White Paper, which will analyse the costs e>f each type of temporary house and explain where and how the increases have occurred since 1945. Noble Lords may consider in view of this that any inquiries which they might otherwise have felt impelled to raise to-day can best be 1219 left until the detailed information is made available in the promised statement.
I have dealt with the principal factors which have created the need for the Bill. The end of the temporary housing programme is now in sight. When it is completed it will have provided 156,000 families with a new home and within a far shorter space of time than would otherwise have been possible. That it has been costly is true; but from the beginning it was understood that this would be so. But I believe that noble Lords will agree that it has played its part nobly in helping to resolve some of our most pressing housing difficulties. I hope therefore that I may have the approval of your Lordships' House for the additional sum of £20,000,000 which is being sought by this Bill to enable the temporary housing programme to be completed and rounded off. I will only aid that the Bill deals solely with finance. I beg to move that the Bill be read a second time.
§ Moved, That the Bill be now read 2a —(Lord Henderson.)
§ 5.58 p.m.
§ LORD LLEWELLIN
My Lords, if I may I should like to congratulate the noble Lord who has just sat down on giving a clearer explanation of this Bill in your Lordships' House than was given in many speeches—in the speeches of Ministers themselves, indeed—in another place. I congratulate the noble Lord on the concise and clear way in which he has brought this Bill before us.
I do not think any of us regrets this temporary housing programme. It was started by the Coalition Government, carried on by the Caretaker Government, and is going to be concluded by the present Government. It has made its contribution, and a considerable contribution, to the housing problem since the war. On the other hand, it was known when it was originally proposed that it was put forward only in order to provide houses quickly. It was, however, also thought that it might have a sobering effect on the prices of traditional building; that is to say, one could compare the cost of a temporary house with what the builders charged for the permanent houses they put up. It is regrettable to find that the temporary houses are costing so much more 1220 than it was originally thought they would. The original estimate, if I remember aright, in August, 1944, was about £600. By March of 1945, it was realized that those houses could not be built for much less than £800. That was the first time that the aluminium house was thought of, and it was then believed that it could be completed at a cost of £900 per house. In October, 1945, as the noble Lord has said, the price of the other seven types was about £1,100 a house and, if I caught his words aright, it is now up to the £1,200 mark.
It is really a great pity that we have had to spend so much on these houses. I do not know—we shall have to wait and see when this White Paper comes out—whether their costing has been sufficiently well investigated, because it seems to me that one ought to get a house of that type for much less than one now has to pay for it. I know that the fitments are extremely good, and I am glad they are; but, after all, the object in having all standard fitments was that they could be ordered as mass production articles. If you are giving a large order for baths, basins, boilers, or whatever it may be, of the same type, there ought to be not a gradual increase in the charge but a decrease. That is why I would like to know a little more—we shall wait for the White Paper to see it—as to why, in the later stages of the production of the aluminium house, its price has gone up to this huge figure of £1,610, compared with the cost of a traditional house which now, in the Provinces, would be £1,300. To pay £310 more for an aluminium house seems to me the kind of thing that one should not do. The price for a completely factory-made house, especially if it is being built, as indeed this has been, under a continuous process system, ought to go down rather than go up, as the factory gets under way. I am really surprised to see that the price of the aluminium house has risen to the frightfully high figure of £1,610.
But, there it is; we are faced with the fact that all these orders have been given and the programme is coming to its end in May, and we are rather like a person who has incurred some very expensive bills which somebody has to pay for. The Government and everybody in both Houses of Parliament are faced with the necessity, willy nilly, of having to pay 1221 for this programme. I think it has helped to meet a great need, but at much too high a price. Noble Lords on these Benches reserve our right to look into and discuss these prices again when we see the White Paper, because I certainly had hoped that they could be kept down more than they have been. I hope that we may, if we investigate them, find out what can be done in future to keep the prices down a little. To-day, however, we have no option but to give a Second Reading to this Bill, for it has helped to meet this need.
I say again that I am sorry that the provision of these houses has been so costly, and it is surprising in these days how easily we bandy about sums of £20,000,000, and so on. I noticed in another place the Minister of Works said: "I may be only a million pounds out." We did not talk like that in the years before the war. We are getting a little loose in the way in which we spend these millions. After all, the estimate put forward of £200,000,000 had £22,000,000 in it for contingencies, and that has all gone. A sum of £22,000,000 for contingencies is a fairly large amount, and now another £20,000,000 has to be provided because the £22,000,000 for contingencies was not enough. I only hope and pray that the paltry little sum of £3,000,000 for contingencies which is included in this estimate will be found to be sufficient.
§ On Question, Bill read 2a; Committee negatived.